The approximate before tax cast of debt for a 15-year, 10 percent, $1,000 par va

Question

The approximate before tax cast of debt for a 15-year, 10 percent, $1,000 par value bond selling at $950 is If a corporation has an. average tax rate of 40 percent, the approximate, annual, after lax cost of debt for a 15 year, 12 percent, $1,000 par value bond, selling at $950 is What is the dividend on an 8 percent preferred stack that currently sells for $45 and has a face value of $50 per share? A firm has issued 10 percent preferred stock, which sold for $100 per share par value. The cost of issuing and selling the stock was $2 per share. The firm's marginal tax rate is 40 percent. The cost of the preferred stock is A firm has common stock with a market price of $55 per share and an expected dividend of $2. 81 per share at the end of the coming year. The dividends paid or- the outstanding stack over the past five years are as follows: The cost of the firm's common stock equity is A firm has determined its cost of each source of capital and optimal capital structure, which is composed of the following sources and target market value proportions: The weighted average cost of capital is General Talc Mines has compiled the fallowing data regarding the market value and cost of the specific sources of capital. Market price per share of common stock $50 Market value of long term debt $980 per band The weighted average cost of capital using market value weights is

Explanation / Answer

Answer:1 Before tax cost of Debt:

950=$100*PVIFA(r%,15)+$1000*PVIF(r%,15)

r=10.68%

Answer:2 Before tax cost of Debt:

950=$120*PVIFA(r%,15)+$1000*PVIF(r%,15)

r=12.76%

After tax cost of Debt=12.76%(1-0.40)

=7.656%

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